CHAPTER 11 FILING BY MORROW

By ANDREW POLLACK, Special to the New York Times

Published: March 11, 1986

SAN FRANCISCO, March 10—
''Being in the microcomputer business is like going 55 miles an hour three feet from a cliff,'' George Morrow once said. ''If you make the wrong turn you're bankrupt so fast you don't know what hit you.''

Mr. Morrow, one of the most colorful figures in the computer business, made that wrong turn. Morrow Designs Inc. said today that it has filed for protection under Chapter 11 of the Federal Bankruptcy Code.

The filing comes only two weeks after the Zenith Electronics Corporation won a $27 million contract from the Internal Revenue Service for portable computers designed by Morrow. The contract award would seem to be just what Morrow needed, but it actually sounded the death knell for the company, which is based in San Leandro, Calif.

Morrow, desperate for cash a year ago, licensed its design to Zenith for a one-time fee of $1.2 million. That means Morrow will not get any revenues from the Zenith award. Morrow had been hoping the award would go to the Sperry Corporation, for which Morrow would have manufactured machines. Morrow's creditors, who had been holding back waiting for the I.R.S. decision, have now closed in.

Morrow has been troubled for about two years. The wait for the I.R.S. award, along with rumors that International Business Machines Corporation was about to introduce a lap-top machine, stalled purchases of portable computers, including Morrow's model, known as the Pivot II.

''There's nothing left here,'' Mr. Morrow said today. ''the patient is out of blood.'' Details of Debts

The bankruptcy filing, made in San Francisco on Friday, indicates that the company has debts of $5.3 milion, of which $2.5 million is owed to Union Bank, based in Los Angeles. The company said it would continue to operate with 12 employees, down from more than 100 a year ago, and would seek to relocate its manufacturing operations abroad. The company also said it would try to be acquired.

Mr. Morrow, who with his wife, Michiko, owns 70 percent of the privately held company, is a high school dropout who resumed his education, including college, in his late 20's after working as a cook. He started a computer business in 1976, selling memory boards by mail from his home.

Morrow Designs had sales in 1984 of about $27 million, Mr. Morrow said. But the company was late in shifting from less powerful 8-bit computers to 16-bit machines, he said, and has lost $6 million in the last two years.

Mr. Morrow, 52 years old, has been one of the industry's most outspoken entrepreneurs, even compiling his sayings into a little red book called ''Quotations from Chairman Morrow.'' One of those quotations reads: ''Computer companies are like desert flowers. They bloom overnight, and they're gone.''